Jamal Khashoggi and Saudi Arabia from the Perspective of Networks
https://www.bloomberg.com/news/articles/2018-10-19/suddenly-toxic-saudi-prince-is-shunned-by-investors-he-courted
https://www.bloomberg.com/news/articles/2018-10-19/explaining-softbank-s-close-ties-with-saudi-arabia-quicktake
https://www.bloomberg.com/news/articles/2018-10-19/how-saudis-turned-yemen-war-into-humanitarian-crisis-quicktake
Following Jamal Khashoggi’s disappearance and brutal murder tied back to Crown Prince Mohammad Bin Salman’s (MBS) regime, corporations have pulled out of Davos in the Desert, the inaugural economic conference in Saudi Arabia. The first article discusses the role of ethics – not tolerating an act like this – with business – Saudi Arabia’s lucrative developing economy, and pivotal role in Softbank. Saudi Arabia is enmeshing itself within the global financial network, with its role in SoftBank. While Saudi Arabia has a considerably amount of power due to its potential, American companies have arguably more power over Saudi Arabia, and as shown by the reaction to the murder of Khashoggi, can exercise it to the detriment of MBS. Saudi Arabia has pledged 40 billion to a Blackstone infrastructure investment fund, intended to take Aramco public in what would be a likely massive IPO, invested $3.5 billion in Uber, all in MBS’ efforts to dig Saudi Arabia out of its dependence on oil and bring it to a modern economy. Blackstone’s CEO, Steven Schwarzman, is now backing out of Davos in the Desert. Jamie Dimon and Bill Ford, CEOs of JPMorgan & Chase and Ford respectively, have also backed out, along with members of the news-media. Even though Blackstone, by pulling out, is ostensibly showing support, it is still benefiting from its ties with Saudi Arabia, and has made no comment regarding that yet. There is a question if these corporations are reducing their attendance as a public relations move or out of business ethics, will this ultimately have any sort of detrimental economic effect on Saudi Arabia, or will this blow over? To what extent can corporations isolate Saudi Arabia because of its frankly appalling human rights record, i.e. how much power do corporations have over Saudi Arabia? One arena in which this may play out is in Aramco’s potential IPO- a lot of transparency is required for a company to be listed in a publicly traded stock exchange, and could Aramco reach that point before, as one commentator on Bloomberg P&L podcast predicted, “pigs fly?”
On a side note, network theory also explains to some extent why the murder Jamal Khashoggi has gotten the response it has in contrast with the lack of response to Saudi Arabia’s crimes against humanity in Yemen. Jamal Khashoggi, as a journalist for the WashingtonPost and permanent resident of the United States, is far more central in the network, having ties to democratic institutions and world powers. Yemen is on the outskirts – both geographically and figuratively – of any such network, and has no strong ties to the actors (i.e. governments or corporations) who could levy consequences at the Saudi Arabian government.